CCP Exam Dumps : Certified Cost Professional (CCP) Exam

If steel costs $1800/ton at the end of Year 3 and the inflation rate for Year 4 is 2.0%, the price of steel at the end of Year 4 can be calculated as:

Price at Year 4=Price at Year 3×(1+Year 4 Inflation Rate)\text{Price at Year 4} = \text{Price at Year 3} \times (1 + \text{Year 4 Inflation Rate})Price at Year 4=Price at Year 3×(1+Year 4 Inflation Rate) Price at Year 4=1800×1.02=1836\text{Price at Year 4} = 1800 \times 1.02 = 1836Price at Year 4=1800×1.02=1836

There seems to be a slight discrepancy with the values provided. Upon recalculating:

1836×1.015=1863 per ton1836 \times 1.015 = 1863 \text{ per ton}1836×1.015=1863 per ton

So, the correct answer should beB. $1863/ton.

If the owner in scenarioBhas the primary goal of getting the project completed and operational as quickly as possible, aCost Pluscontract type is most likely to be used. This contract type allows for flexibility in managing costs, and the contractor is reimbursed for all costs plus a fee. It motivates the contractor to expedite the project since the costs are covered, and any additional effort is compensated. Therefore, the correct answer isA. Cost plus.

Monte Carlo Simulationis commonly used in investment analysis to evaluate risks associated with potential investments. This method involves running multiple simulations to predict the range of possible outcomes based on varying inputs and assumptions. In the context of investment, Monte Carlo simulations help in assessing the uncertainty and volatility of returns by simulating various scenarios of cash flows, costs, and economic conditions, making it an ideal tool for risk evaluation.